In the bowl of a stand mixer or in a regular large bowl, whisk the milk, 2 tablespoons of the sugar and yeast together and let it sit for at least 5 minutes or until it has activated.
Once it has puffed up, stir in the remaining sugar, egg, butter, vanilla and salt.
Place the bowl onto your mixer then use a dough hook to gradually stir in the flour or use a spoon to stir to combine.
Then knead the dough for 3-4 minutes, adding one or two sprinkles of flour if the dough does not start to pull away from the sides. (Note: The dough should be elastic and smooth but still sticky, you will be tempted to add more flour, but if you add too much, the beignets will be heavy and gummy.)
Cover the bowl with cling wrap and let it rise for at least 2 hours or refrigerate overnight to double in size.
Heat 2 inches of oil in a deep-frying pan or Dutch oven over medium heat until it reaches 350 degrees Fahrenheit. Check the temperature with a cooking thermometer.
Lightly flour a countertop or cutting board then turn the dough out on top, using a rubber spatula to get any remaining sticky bits from the bowl.
Lightly flour the surface of the dough then flour a rolling pin and roll the dough out into a rectangle that’s about ½-inch thick.
Use a pizza cutter to cut 1-2 inch squares in the dough then fry 4-5 squares at a time for 2-2 ½ minutes, flipping halfway through. The dough should puff up while cooking. If it doesn't, the oil isn't hot enough.
Let them drain off any excess oil on a paper towel lined plate then fry the remaining beignets.
Let them cool for 5 minutes before generously dusting with powdered sugar and serving immediately.